Could Toyota Motor Corp. be mortal after all?
For the third month in a row, Ford Motor Co. outsold the Japanese juggernaut in the United States, still a crucial and rich market amid this nagging recession. In June alone, the Dearborn automaker reported an 11 percent year-over-year decline in monthly sales to 148,153 cars and trucks, compared to Toyota's 34.6 percent slide to 131,654 vehicles.
And this: General Motors Corp. -- beleaguered and bankrupt, its dealer body jittery and brand image suspect, its only willing lender the Treasury -- so far this year has outsold Toyota 947,518 to 770,449, according to Autodata Corp. Partly evidence of Toyota's strong presence in, and dependence on, the imploding California market?
Yes, but what else?
For the first three months of the year, Toyota lost more money than Ford and even GM. Since then, the Japanese automaker has replaced its president with a scion of the founding family, 53-year-old Akio Toyoda, who promises a "back to basics" push for the industry's richest automaker even as more troubles emerged in the first weeks of his new assignment.
GM, a longtime partner with Toyota in the New United Motor Manufacturing joint venture, this week confirmed that it would use its Blitzkrieg Chapter 11 bankruptcy to declare the decades-old California tie-up with Toyota a bad asset and leave it to be unwound in bankruptcy court.
The move presents Toyota with a dilemma: Shutter the plant in the Bay Area city of Fremont, which would violate its no-plant-closing pledge and inflame relations with powerful Washington Democrats, including Speaker Nancy Pelosi, D-San Francisco. Or continue to lose money running an underutilized assembly plant, the only auto assembly plant still operating in anti-industrial California.
Should be a comparatively easy call, considering Toyota's assembly options elsewhere in the United States and Canada. Those would include, by the way, the gleaming new plant it opened in San Antonio at just the wrong time to build the full-size pickups ("that nobody wants," a snarky comment of dubious validity). And there's the half-finished plant in Mississippi that was supposed to be the first U.S. source for its game-changing Prius hybrid.
News flash: Detroit's automakers are not the only "arrogant" players in the global auto game to place big product-and-plant bets at the wrong time, even if they clearly have a lot less financial capacity to absorb their bad calls. Nor are GM, Ford and Chrysler Group LLC the only ones to get themselves cross-ways, in theory, with politicians busy reshaping the American economy to their image.
This is ObamaNation in the Great Recession, where many routine business decisions have acute political implications. The stunning collapse of U.S. auto sales and the slow climb back is remaking the auto industry, even pressuring the most rich and powerful to change.
In Toyota's case, that means battling the "big company" disease foreseen by retired CEO Fujio Cho and contending with leaner American rivals, two of them backed by the federal government.
Rich Toyota (very rich, with roughly $33 billion in cash on hand) will be forced to consider the political ramifications -- particularly among the powerful California delegation -- of its decisions and Washington's tactics to "save" Detroit and the United Auto Workers.
None of which is to suggest that Toyota is going anywhere because it's not. It's rich. It's smart. It's proven itself to be far more adept than its Detroit rivals at delivering solid products with mass appeal, working the corridors of power in today's Washington and making strategic manufacturing investments in non-auto states to turn them into Toyota states.
And the fact that it's the acknowledged leader in the politically required greening of the U.S. auto industry probably trumps the fact that it runs no union shops in its assembly and parts plants in the United States -- with the exception of the NUMMI plant in Fremont.
When this recession ends, if slowly, a likely three-way battle will be under way for automotive leadership in the rich U.S. market. Not yet sure if GM will emerge from bankruptcy as planned and be one of the three. But Ford will be there, and so will Toyota -- guaranteed.